Vending

Luckin Coffee boosts 2021 half year sales

Photo provided by Luckin Coffee.

October 21, 2021

Luckin Coffee Inc., a pioneer in coffee vending and a competitor to Starbucks in China, which filed for bankruptcy protection in February, reported more than 100% gain in first half year revenues over 2020 in its unaudited financial results for the six months ended June 30, 2021.

Revenues growth was primarily driven by the increased average selling price for the company's products, the increase in the number of monthly transacting customers and the number of products sold.

As a result of the COVID-19 pandemic, the company's business and financial performance in the first half year of 2020 were materially adversely affected, the company stated in an earnings report.

"I am pleased with the overall performance we achieved in the first half of 2021," Dr. Jinyi Guo, chairman and CEO, said in the press release. "In particular, it is worth noting that substantial revenue growth was driven by an increase in average revenue per self-operated store. Several factors contributed to our strong performance. We further improved our brand recognition, increased customer retention and order frequency, successfully introduced new products and achieved higher net selling prices."

Total net revenues in the first half year were RMB3.18 billion ($492.9 million), an increase of 106% from RMB1.54 billion in the same half of 2020.

Net loss was RMB211.4 million ($32.7 million), representing a decrease of 86.4% from a loss of RMB1.55 billion in the first half of 2020.

Non-GAAP net loss was RMB84 million ($13 million), compared to a loss of RMB1.54 billion in the first half of 2020.

Basic and diluted net loss per American Depository Share (ADS) was RMB0.80 (16 cents), compared to a loss of RMB6.16 in the first half of 2020. (An ADS is an equity share of a non-U.S. company held by a U.S. depositary bank and available for purchase by U.S. investors, according to Investopedia.)

Non-GAAP basic and diluted net loss per ADS was RMB0.32 (8 cents), compared to a loss of RMB6.08 in the first half of 2020.

Shares traded at $16 today against a 52-week range of $3.60-$17.79.

Revenues from product sales in the first half year were RMB2.74 billion ($424.6 million), an increase of 89.3% from RMB1.44 billion in the same half year of 2020.

Revenues from partnership stores in the first half year were RMB441.2 million ($68.3 million), an increase of 357.8% from RMB96.4 million.

Same-store sales growth for self-operated stores was 82.7%, compared to negative 20.3% in the same half year of 2020.

Average monthly transacting customers in the first half year were 10.5 million, an increase of 35.1% from 7.8 million.

Total number of stores was 5,259 as of the end of the first half year, including 4,018 self-operated stores and 1,241 partnership stores.

Self-operated stores decreased by 5.8% from 4,267 stores as of the end of the same half year of 2020 and partnership stores increased by 50.6% from 824 partnership stores.

Revenues from freshly brewed drinks were RMB2.42 billion ($375.1 million), representing 76.1% of total net revenues in the first half of 2021, compared to RMB1.25 billion, or 80.8% of total net revenues.

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